The President’s re-election (More Discussion V)

In my last post "The President’s re-election (More Discussion IV)" I continued the debate with Roger Streit of West Orange, NJ. Even before this I had considered discontinuing the publication of these debates, but an enthusiastic interjection from Michael A. Cerrato, J.D. Esq. of Westville, NJ who exclaimed “Wow, this is a great exchange” encouraged me to keep sharing the debate with my readers.

When I posted "The President’s re-election (More Discussion IV)" I had thought that this would conclude the debate, But now I received another very provocative presentation from Louise Mayo, Ph.D, Professor of History Emeritus, from Pittsburgh, Pennsylvania, who wrote:

I have been following your complex discussions with interest. I found your comments about gun ownership very helpful and learned some things I did not know about gun ownership. 

I did want to comment on the debt discussion and its significance. First, in answer to your query, the debt was 40% of GDP at the height of the Great Depression. It rose to 120% by the end of World War II. (It's about 102% today - up from 98% in 2010). Clearly the economy improved as the debt rose as a result of government money injected into the economy. Your, I assume, sarcastic suggestion that we could quadruple our Defense budget would actually work. That is, any money creating jobs and income would be effective when the economy is weak. Presumably, however, there are better long-term ways to accomplish the same ends -- infrastructure building and repairs, education, research etc. The experience of FDR in his second term when he cut back too soon and threw a recovering economy back into a severe recession and the British experience today show that attempts to lower debt and balance the budget on the backs of a weak economy are counter-productive. Borrowing rates will never be as low again as they are now. Interest on debt as a share of GDP has been declining and is now 1.5%. Due to low interest rates, only 2% of the principal goes to service the debt, down from 7% in the 1980s. We should be investing in those long-term improvements I mentioned earlier. We could cut back on real waste, try to identify ways in which we can save money in the health care system, close some tax loop holes and then, think about more serious savings to kick in once the unemployment rate falls below, perhaps, six percent.

My response thereto was rather lengthy and therefore rather than burdening the reader with too long a post, I am saving my rebuttal for my next post, which will be entitled "The President’s re-election (More Discussion VI)."

In the meantime at the risk of causing this discussion to go on ad infinitum I still invite:

Comments, questions, or corrections, are welcome and will be responded to and distributed with attribution, unless the writer requests that he/she not be identified.